Ronnie Peterson had a rear brake failure during the morning warmup, crashing his Lotus 79/3. He reverted to his backup Lotus 78 for the race. The start was chaotic; the starter, Gianni Restelli, activated the green lights prematurely. This caused a tightly bunched field approaching the chicane, leading to a multi-car pile-up involving James Hunt, Riccardo Patrese, Vittorio Brambilla, Hans-Joachim Stuck, Patrick Depailler, Didier Pironi, Derek Daly, Clay Regazzoni, and Brett Lunger. Peterson was trapped in his car, which caught fire. Hunt, Regazzoni, and Depailler managed to free him before he sustained significant burns.
Following the first-lap incident, drivers were permitted to use spare cars for the restart. Non-starters included Peterson and Brambilla, who were taken to Niguarda hospital in Milan, and Stuck, who was prevented from restarting due to a concussion. During the red flag period, Jackie Stewart interviewed Andretti. Andretti stated, "Yeah, it couldn't be worse. Seems like the width of the straightaway invites a lot of passing and dodging it going right into like a funnel and I'm really worried about Ronnie. Yeah, it hit the guardrail at such impact it just incredible, tore everything out and it's very bad".
The race restarted at 6:15pm, shortened to 40 laps to avoid sunset. Prior to the restart, Jody Scheckter crashed his Wolf at the second Lesmo curve, damaging the Armco barrier. Andretti, Hunt, Lauda, Reutemann, and Emerson Fittipaldi inspected the damage and refused to start until the barrier was repaired. Villeneuve overtook Andretti at the restart. Both led for several laps before receiving a one-minute penalty for a jump start. Lauda ultimately won the race, with Andretti finishing ahead of Villeneuve. Andretti secured the 1978 World Drivers' Championship but celebrations were muted due to Peterson’s condition.
Peterson was admitted to Niguarda hospital with severe leg injuries. He had 27 fractures in both legs. Peterson developed breathing problems, was placed on a ventilator, and suffered a fat embolism, leading to kidney failure and serious brain damage. He was pronounced dead at 9:55am.
Emerson Fittipaldi stated, "I just can't believe it. We have been friends for so many years and now he is gone. Racing will change a lot for me. He was one of the greatest drivers and no one will replace him." Mario Andretti said, "Oh no. I wanted that title so badly, but I did not want to win it like this. What the hell shall I do with it now? I don't feel anything for it. One of my best friends is gone and motor racing will never be the same again."
As a result of the start line crash, a medical car would follow the cars on the opening lap of every F1 race. Vittorio Brambilla recovered from his injuries but it ended his full-time career in Formula One.
The race was notable for being the 300th Formula One World Championship Grand Prix. Graham Hill was the most experienced driver, having raced 176 of them. Jim Clark had achieved 33 pole positions and 28 fastest laps. Ferrari had achieved 87 pole positions and 82 fastest laps. British engine supplier Cosworth held multiple records: 117 Grand Prix wins, 324 podium finishes, and 105 pole positions.
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